The Road to Recovery: How the Franchise Industry Will Bounce Back Post-Coronavirus

With the new status quo consisting of shelter-in-place orders and economic uncertainty, it can be challenging to think about life on the other side of the COVID-19 crisis. The pandemic has shifted the way in which businesses and consumers operate, and industries across the globe are set to navigate this economic fallout for years to come. Although it can be challenging to stay optimistic right now, businesses will bounce back — including those operating in the franchising space.

The road to recovery begins with the struggles franchising has overcome in the past. Historically, economic downturns have led to an increase in activity for the franchise industry. 

“The trends following past economic downturns — recessions even — have led to greater demand for franchise opportunities,” said Lauren Wanamaker, senior director of development for Amazing Lash Studio®. “I don’t think it will be any different with this crisis. Although, the types of industries that will excel post-COVID will be very different from those that did in the past — at least in the immediate future.”

Wanamaker notes that the discovery process will become more important than ever. “Franchisees are going to scrutinize the types of businesses that make sense in the immediate aftermath of the crisis,” she said. “Overall, I’m confident that development will bounce back and be better than it was before.”

The types of business ownership opportunities that entrepreneurs consider will likely depend on their personal experiences during the pandemic as well as how brands handled their operations. Not only will candidates want to know how franchisors supported their local owners throughout this crisis, it will likely become a make-or-break-it factor down the line.

Consumer demand on the other side of this crisis will also play a role in the franchise industry’s road to recovery.

“After experiencing vulnerability in the workforce, self-reliant people will likely tap into their entrepreneurial spirit — and we all know that the franchise industry thrives on that,” said Michael Porpora, agency partner at Marquis Professional Risk. “I also think the bounce back is going to be much higher than expected, particularly in the personal care sector. Concepts that feature membership-based gyms, hair salons, nail services, etc. are going to boom in popularity.” 

Service brands aren’t the only ones that have the potential to bounce back better than ever. While brick and mortar locations of all kinds will continue to face new cleaning standards following COVID-19 concerns, the innovation and work being done now has the potential to help boost a brand’s appeal to candidates down the line. For example, restaurant concepts that have pivoted their model over the past month to enhance technology offerings will have an advantage on the other side of the crisis.

“We’ve seen incredible innovation and flexibility,” said Roslyn Stone, MPH, the founder behind Zedic, an app that connects restaurateurs and hoteliers directly to medical professionals. “The change in mindset from where we were six months ago to where we are today is remarkable.”

By continuing to remain flexible and respond to both candidate and consumer concerns, franchise brands have the potential to come out on the other side of the pandemic stronger than they were in the past.